SAS® helps Indigo get personal with reading enthusiasts

Indigo Books & Music operates stores in all 10 Canadian provinces under the brand names Indigo, Chapters, World’s Biggest Bookstore and Coles. The company has 247 retail locations across Canada, as well as an online retail presence. It was the first book retail chain in the country to add music, gifts and licensed cafés to store locations, and regularly offers in-store events such as personal appearances and performances.

The book business has been under pressure from online book retailers that offer heavily discounted prices on books over the Internet. “There are still a lot of customers who value the experience of walking into a bookstore and browsing before they buy,” said Kevin Chan, Director of Customer Relationship Management at Indigo Books & Music. “The trick is being able to find those customers, and we’re doing that with SAS.”

The company’s Customer Relationship Management (CRM) department manages all marketing analytics for direct mail and e-mail campaigns, and is responsible for reporting on the health of Indigo’s loyalty business under its iRewards program.

“Customers aren’t going to listen to us blasting generic messages at them,” said Chan. “We have to make sure our communications are customized and relevant to each customer, week after week. SAS helps us create a profile – what we call a ‘book DNA’ – of each customer, and we use that to customize our marketing efforts down to the individual level.” Indigo’s use of SAS expands beyond marketing, however. The CRM department works with the planning and procurement group to forecast and plan stock replenishment, and consults with the real estate team to determine the best locations for new stores. But to do this, it must cull through 10 years’ worth of transaction history in its ERP data warehouse.

To query the data quickly and understand it from a business perspective, Indigo relies on SAS® Enterprise Guide®, which provides easy access to data sources through a SAS graphical interface. It also uses SAS Enterprise Data Integration Server to provide a visual design tool for building, implementing and managing data integration processes, regardless of data sources, applications or platforms. SAS Management Console provides a single point of control for performing all administrative tasks.

This helps Indigo predict who is going to be shopping in the next 30 days. “We can closely predict what type of products they’re going to buy, so we know what type of messaging to put in front of them,” said Chan. Using SAS, Indigo is able to determine if the customers it’s investing in are the ones who will actually make purchases. Indigo is also able to join brick-and-mortar data with online data to get a holistic view of its customers. As a result, the retailer is able to provide mass customization for millions of customers – each one getting personal recommendations on book titles.

“At Indigo we strive to be the best in class in whatever we do, so when it came time for us to look at business analytics, SAS was really the only vendor on the table,” said Chan. “We have more than 10 years’ worth of data and without a tool like SAS, there’s no way we could make any sense of it and produce actionable campaigns.”

SAS is a critical part of our end-to-end marketing process. If we’re striving to be best in class, then we need to use the best-in-class tools.

Previously, Indigo’s CRM analysts used various Microsoft and SQL tools to extract and analyze data, but their data wouldn’t reconcile, and a lot of time was wasted trying to figure out why. With SAS, they’ve been able to standardize those processes, and everyone is now looking at the same data. They also have flexibility in how they view that data, which provides a competitive advantage. “Other vendors can extract data, but then you’re stuck with how they’ve structured the data, so it’s not as useful,” said Chan.With SAS, analysts are able to build their own models quickly and test them against challenger models; as a result, they’ve been able to almost double their campaign results. By executing better campaigns, they’re able to understand how to drive incremental revenue through specific models.

“The benefits of SAS are seen everywhere – from extracting data in an automated fashion to helping us analyze campaigns,” said Chan. “SAS is a critical part of our end-to-end marketing process. If we’re striving to be best in class, then we need to use the best-in-class tools.”

Challenge

With the growth of discount competitors in the market, Indigo needed to better manage and utilize its customer data to increase repeat business.